Canada GDP Numbers: What Borrowers Should Know
Much like the global economic landscape, Canada’s economy is constantly in flux. Gross Domestic Product (GDP) serves as a reliable indicator, providing insights and data into the economic health and prospects of the Canadian economy.
The most recent figures indicate that GDP rose 0.2% in December, after remaining unchanged in November. The quarterly report, released on February 27th, revealed that GDP declined 0.2% in the fourth quarter of 2025. This post provides a deeper understanding of Statistics Canada’s latest data and its implications for borrowers in the Canadian market.
Key Takeaways
- The latest GDP numbers show the Canadian economy was unchanged in November.
- In 2025, real GDP grew 1.7%.
- Preliminary estimates indicate the economy will remain unchanged in January.
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Latest GDP Numbers in Canada
Gross domestic product (GDP) measures Canada’s economic activity based on the total value of all goods and services produced in Canada over a specific period. Dividing total GDP by population yields the average economic activity per citizen, known as GDP per capita.
When tracked over many years, GDP can show whether Canada’s economy is growing or contracting. When GDP rises, it is a sign of good economic health. Meanwhile, contracting GDP indicates that Canada is not operating at full capacity and may be heading into, or already in, an economic recession.
Statistics Canada reported that the Canadian economy grew 0.2% in December, after remaining unchanged in November.
Sectors that saw contractions include:
- Mining, quarrying, and oil and gas extraction fell 0.9%, more than offsetting November’s gains.
Sectors that saw gains include:
- The manufacturing sector rose 1.2%, partially offsetting the monthly declines in October and November.
- The wholesale trade sector increased 1.7%, offsetting November’s contraction, with motor vehicle and motor vehicle parts and accessories merchant wholesalers leading the recovery.
- The utilities sector grew 2.7%, led by electric power generation, transmission and distribution.
- The public sector grew 0.2%, with public administration the largest contributor to growth.
- Transportation and warehousing rose 0.7%, led by transit, ground passenger and scenic and sightseeing transportation, as well as couriers and messengers.
GDP Fourth Quarter of 2025
Statistics Canada’s Q4 GDP data recorded a 0.2% decline following a 0.6% rise in Q3. This decline was primarily due to withdrawals of business inventories following inventory accumulations in Q3. Higher exports, household spending and government capital investment offset some of the decline.
Imports grew 0.3% as higher imports of computers, clothing and footwear, and metal ores were offset by lower imports of pharmaceutical and medicinal products. For 2025, imports were down 0.4% due to the 2.9% decrease in Q3.
Exports increased 1.5% after a 0.9% increase in Q3. Growth was led by higher exports of unwrought gold and of unwrought aluminum and aluminum alloys. Overall, exports in 2025 fell 1.7% as shipments to the United States never fully recovered following a drop in Q2.
Canada’s Economy Grew 0.2% in December, With No Growth Projected for January
December’s GDP rose 0.2%, with 11 of 20 industrial sectors growing. According to Statistics Canada’s preliminary estimate for January, GDP is expected remain essentially unchanged. This estimate is based on increases in mining, quarrying, and oil and gas extraction, as well as in finance and insurance. Offsetting the increase are declines in manufacturing and in real estate and rental and leasing.
Housing Investment Increases
Residential investment, a key driver of the Canadian economy, fell in Q4. This decline was driven by a 2.4% decrease in ownership transfer costs, which measure resale-market activity. Lower renovations (-1.3%) and new construction (-0.5%) also contributed to the decline in Q4.
Overall, residential investment marked its first annual increase since 2021. Increases in new construction (+1.0%) and renovations (+2.7%) more than offset the decline in ownership transfer costs (-3.4%) over the year.
Real Estate Rental and Leasing vs. Home Sales
The real estate rental and leasing sector rose 0.3% in Q4 and was up for the third consecutive quarter. Overall, in 2025, this sector experienced a 1.7% increase despite a 2.1% decline in offices of real estate agents and brokers and activities related to real estate, as national home resales fell.
Household Spending Increases
Household spending rose 0.4% in Q4 after declining 0.2% in Q3. Higher rent and financial services in Q4 were partially offset by lower spending on new passenger vehicles and alcoholic beverages. Annually, household final consumption was up 2.3% for 2025. This kept pace with the 2.2% growth from each of the previous two years. The increase in 2025 was driven by higher household spending on financial services and rent.
Frequently Asked Questions (FAQ) About the Canadian Gross Domestic Product (GDP)
What is GDP?
Gross Domestic Product (GDP) measures Canada’s total economic output over a specific period. It represents the monetary value of all finished goods and services produced domestically by Canadian businesses.
What is the GDP of Canada, and why is it important?
As of Q4 2025, Canada’s GDP declined by 0.2%, indicating economic contraction. GDP is a key indicator of whether our economy is performing well or showing signs of a recession. A recession can be determined by two consecutive quarters of decline in real GDP.
What are the major industries in Canada?
Canada has a diverse economy, with key industries including natural resources (such as oil, mining, and forestry), manufacturing, the services sector (including real estate, education, and health), and, increasingly, technology and innovation.
Final Thoughts
The latest GDP numbers paint a complex picture of the Canadian economy. With the economy reacting daily to interest rates, this may be an opportune time to prepare your finances if you are looking to purchase a home or renew or refinance your mortgage.
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